Financial statements for Praven Company appear below: PravenCompany Statement of Financial Position December 31, Year 2 andYear 1 (dollars in thousands)
Currrent assets:
Year 2 Year 1 Cash and marketable securities. . . . . . . . . . . .$ 150 $ 130
Accounts receivable, net . . . . . . . . . . . . . . . . . 190160
Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . .170 180
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . 5040
Total current assets . . . . . . . . . . . . . . . . . . . . . .560 510
Noncurrent assets:
Plant & equipment, net . . . . . . . . . . . . . . . . . .1,420 1,330
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . .. $1,980 $1,840
Current liabilities:
Accounts payable . . . . . . . . . . . . . . . . . . . . . . $ 110$ 100
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . 9060
Notes payable, short term . . . . . . . . . . . . . . . . 260260
Total current liabilities . . . . . . . . . . . . . . . . . . . 460420
Noncurrent liabilities:
Bonds payable . . . . . . . . . . . . . . . . . . . . . . . . . 400400
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . .. 860 820
Stockholder’s equity: Preferred stock, $5 par, 15% . . . . . . . .. . . . . . 120 120
Common stock, $10 par . . . . . . . . . . . . . . . . . 240 240
Additional paid-in capital—common stock . . . . 210 210
Retained earnings . . . . . . . . . . . . . . . . . . . . . . 550450
Total stockholders’ equity . . . . . . . . . . . . . . . . . 1,1201,020
Total liabilities & stockholders’ equity . . . . . . . . $1,980$1,840
Praven Company Income Statement For the Year Ended December 31,Year 2 (dollars in thousands)
Sales (all on account). . . . . . . . . . . . . . . . . . . . .$1,700
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . .1,190
Gross margin. . . . . . . . . . . . . . . . . . . . . . . . . . .510
Selling and administrative expense . . . . . . . . . . 200
Net operating income . . . . . . . . . . . . . . . . . . . . .310
Interest expense . . . . . . . . . . . . . . . . . . . . . . . .40
Net income before taxes . . . . . . . . . . . . . . . . . . .270
Income taxes (30%) . . . . . . . . . . . . . . . . . . . . . .81
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 189
Dividends during Year 2 totaled $89 thousand, of which $18 thousandwere preferred dividends. The market price of a share of commonstock on December 31, Year 2 was $130.
Required: Compute the following for Year 2:
1. Book value per share
2. Working capital
3. Current ratio
4. Acid-test ratio
5. Accounts receivable turnover
6. Average collection period
7. Inventory turnover
8. Average sale period
9. Times interest earned
10. Debt-to-equity ratio
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